All properties must go through the registration process. The Bankruptcy Court is the judicial process to determine if a will is valid, since any qualified debt and property taxes, and distribute all assets remain.
It is potentially a very complicated legal process, and a solicitor must be involved in any estate planning.
Using these strategies to help you plan your property to avoid some common challenges in the succession process and save money:
1. Have a valid will. Probate can last up to a year in many cases; typically this is due to a protracted process of validating the will. Probate is a legal process, so the longer it takes, the more money the attorneys make. Be sure to draw up your will with an attorney and review it annually for anything that needs to be addressed.
2. Avoid having your assets pass through probate.
- Create one or more trusts. Assets and property within a properly drafted trust avoid the probate process. They are simply transferred to the beneficiaries of the trust. This also has the effect of providing greater protection of the assets from creditors.
- Name beneficiaries for your 401(k) account. This will allow the account to avoid having to pass through the probate process. Again, this can provide protection from creditors.
- Name beneficiaries for your IRA. As with the 401(k), naming at least one beneficiary will avoid probate and can shield the assets from creditors. Just call your IRA firm and they can help you out.
- Name beneficiaries on your life insurance policies. This is the same situation as above. If you don't name a beneficiary, then the proceeds are simply paid to your estate and must pass through probate, increasing the attorney's fees. Be sure to name your beneficiaries!
- Own Assets Jointly. This can include almost anything: real estate, vehicles, stocks, and more. A jointly owned asset is passed onto the survivor automatically.
- Your bank account can have a paid-on-death designation (P.O.D.), and brokerage accounts can have a transfer-on-death (T.O.D.) designation, allowing ownership of the accounts to pass directly to the beneficiaries upon your death.
- Give it away: You can gift your assets to anyone you choose, each year, up to a specific amount, tax-free. As of 2011, you can give as many people as you want a gift up to $13,000 without having to worry about paying taxes on the gift.
- Also, the tax only kicks in after you have gifted a total of $1 million over your lifetime. Any gifts that do not exceed $13,000 do not count towards the $1 million limit. Interestingly, it is the gift-giver that is responsible for paying the tax, if any.
- This reduces the amount of your estate and will lower the probate costs, since they are typically based upon the total value of the estate. See your tax preparer for more information.
Except in certain circumstances, the funds, which can avoid probate fees remain subject to federal property, including the activities of a living trust. Good inheritance tax solicitor can guide you the maze in order to influence the family, the costs of succession as possible.
The real enemies of the approval process are the lack of planning and non-use of all available options. After having prepared you will have to eliminate the amount of time your property goes through the approval process. In the legal world, time is very expensive. You do not want lawyers to get their money instead of your heirs.
As you plan your estate with adequate financial and legal professionals, you can maximize the size of your estate to your family, friends and charities. The alternative is unfortunate is that most of your estate to your creditors, several lawyers and judges.